In cease-and-desist letters sent on Friday, the SWC accused all three platforms of offering sports betting products without a license under the Tennessee Sports Gaming Act. According to the regulator, rebranding wagers as “event contracts” does not change their economic reality: users are still staking money on the outcomes of sporting events. That distinction, the council argues, is where state law draws a firm boundary.

The “Event Contract” Defense Hits a Wall

The SWC said Kalshi and Polymarket are effectively replicating activities reserved exclusively for licensed sportsbooks. Regulators also highlighted the absence of core consumer protections, including age verification, responsible gaming tools and anti–money laundering safeguards. In the council’s view, those gaps elevate the platforms from regulatory gray areas into immediate public-interest risks.

As a result, Tennessee ordered the companies to void all sports-related contracts involving state residents and refund all user balances by January 31, 2026. Failure to comply could trigger fines of up to $25,000 per violation, court injunctions and referrals to law enforcement for further investigation.

Federal vs. State Authority: The Conflict Deepens

Kalshi and Polymarket maintain that they operate as CFTC-registered contract markets and that federal commodities law preempts state gambling regulations. Tennessee flatly rejects that interpretation, insisting that federal registration does not nullify the state’s authority over sports wagering within its borders.

That legal fault line is widening. Several states, including Connecticut, have already taken similar action, producing mixed judicial outcomes. A federal judge recently paused enforcement of Connecticut’s cease-and-desist order against Kalshi, but Tennessee’s move suggests states are not backing down.

Kalshi is now facing regulatory challenges in New York, Massachusetts, New Jersey, Nevada, Maryland and Ohio. Despite the growing legal pressure, trading volumes on prediction markets continue to climb, underscoring the stakes of the dispute.

A First for Polymarket, the Ninth State Overall

The Tennessee action appears to be the first publicly disclosed state-level shutdown order specifically targeting Polymarket. More broadly, Tennessee has become at least the ninth state to formally move against prediction markets tied to sports outcomes.

State officials have repeatedly warned that these platforms threaten licensed sportsbooks and the tax revenues they generate for public programs. SWC Executive Director Mary Beth Thomas described the contracts as incompatible with Tennessee’s consumer protection framework and an urgent danger to the public interest. Nearly identical language appeared in letters sent to Kalshi and Crypto.com.

Lawsuits Loom, Uncertainty Persists

Kalshi has already responded by filing suit in federal court, calling Tennessee’s action an unlawful intrusion into federally regulated markets. Polymarket and Crypto.com have yet to issue formal statements, though gaming law experts expect additional lawsuits to follow.

For now, the picture remains unsettled. States are accelerating enforcement, while federally regulated platforms seek shelter in the courts. This is not merely a technical jurisdictional dispute. It signals a deeper fracture over who controls the future of sports betting—and where the next legal boundary will be drawn.

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XRP’s Surge and Whale Accumulation

Santiment reported that XRP reached $2.69 on January 14, 2024, its highest level since December 17, 2024. By the time the article was published, XRP had surged further to $2.83, a level not seen since early 2018.

Santiment highlighted that XRP whales, particularly those holding between 1 million and 10 million XRP tokens, have accumulated a total of 1.43 billion XRP since November 12, 2024. This accumulation represents a 37.4% increase.

XRP ETF Speculation

Derive’s Head of Research Sean Dawson mentioned that XRP‘s strong momentum is likely driven by the expectation of a potential XRP ETF listing in 2025. With strong purchases of Bitcoin, investors may rotate their capital into alternative coins like XRP, further boosting the bullish sentiment around it.

You Might Be Interested In: Elon Musk Shared, That Memecoin Flew: Up 500%!

It is speculated that XRP’s legal battle with the SEC could conclude in favor of XRP this year. Dawson stated that while the SEC may appeal the decision, the “pro-crypto” stance in the White House could influence SEC appointments and provide more support for the crypto market.

JPMorgan’s XRP and SOL Predictions

Billion-dollar bank JPMorgan predicts that Solana (SOL) and XRP ETPs (Exchange-Traded Products) will outperform Ether (ETH) ETFs in the first six months. According to JPMorgan‘s report, SOL is expected to attract between $3 billion and $6 billion in net assets, while XRP is expected to gather between $4 billion and $8 billion in new assets.

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Ripple’s Chief Legal Officer Stuart Alderoty expressed optimism, hoping leadership changes at the SEC would lead to a more reasonable approach.

Paul Grewal, Coinbase’s Chief Legal Officer, also echoed this sentiment on social media after Trump’s victory on November 6. Both Coinbase and Ripple were among the top donors supporting pro-crypto candidates in this election.

One of Trump’s main promises to crypto voters includes replacing SEC Chair Gary Gensler. Under Gensler, the SEC imposed stringent measures on various crypto firms, especially around classifying digital assets as securities, which led to extensive legal battles within the industry. Ripple, engaged in litigation with the SEC since 2020, has already spent millions on this battle. Ripple CEO Brad Garlinghouse mentioned that the company expects to spend up to $200 million on legal defense.

Trump’s re-election grants him the power to remove the SEC Chair, although Senate approval is required to complete the process. Crypto-friendly SEC Commissioner Hester Peirce is seen as a potential successor to Gensler.

Although the future SEC leadership remains uncertain, Gensler appears open to potential leadership changes. He told the Wall Street Journal, “Presidents traditionally choose the SEC Chair, which is a beautiful part of our democracy,” signaling acceptance of the possibility of new leadership.

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